Major City Insights: Toronto—May 2022

The Conference Board of Canada, May 20, 2022
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Despite the rise in case counts from both the Omicron and BA.2 variants early in 2022, most Canadian cities have already seen restrictions loosened or dropped. We expect this to aid in the continued recovery of CMA economies across the country this year. It’s especially good news for the travel and tourism markets in each region, which so far have lagged most other industries in returning to their pre-pandemic levels. Still, higher prices and instability in other parts of the world serve as a downside risk to this year’s outlook.

This edition of our Major City Insights provides new forecasts for growth in 13 major cities across Canada as of March 23, 2022.

This forecast focuses on the Toronto metropolitan economy.

Document Highlights

  • The Toronto economy will expand by 3.8 per cent this year and another 3.5 per cent in 2023.
  • Strong population growth is a key driver for our bright outlook. After two years of muted immigration levels and a desire among many consumers for larger homes outside the city, population growth will accelerate in the short term.
  • Housing markets in Toronto will keep making headlines. Higher interest rates and a reduction in built-up savings among consumers may hurt residential construction, but those factors will be dwarfed by a thirst for greater housing supply in the metropolitan area.
  • Our view is that Toronto’s vibrant arts and entertainment sector will take off after two difficult years. Capacity limits and mask mandates in most public spaces were lifted in March.
  • Manufacturers in the metropolitan area are still trying to navigate through supply chain disruptions. Although there are some signs the pandemic-related bottlenecks are easing, they won’t completely fade this year. Meanwhile, the war in Ukraine is further clouding the situation.
  • Our outlook for professional services is favourable, as the Canadian economy continues to pivot from goods to services, a trend we think is particularly positive for Toronto.

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